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HMRC internal manual

Inheritance Tax Manual

Foreign settled property: when the settlement was made

The legislation refers to the settlor’s domicile (IHTM13000) ‘at the time the settlement was made’. You should proceed on the basis that, for any given item of property (IHTM04030) held in a settlement, the settlement was made when that property was put in the settlement. Refer any case where this view is challenged to Technical.


Sabina, when domiciled in Spain, transfers a house in Spain into a new settlement. Later she acquires a UK domicile and then adds some Australian property to the settlement.

The Spanish property is excluded property because of Sabina’s non-UK domicile when she settled that property. However, the Australian property is not excluded property as Sabina had a UK domicile when she added that property to the settlement.